Greggs has overtaken Costa Coffee to become the UK’s largest branded coffee shop operator, highlighting the growing influence of food-to-go retailers in the increasingly competitive coffee market.

According to Allegra World Coffee Portal’s Project Café UK 2026 report, Greggs had 2,737 outlets compared with Costa’s 2,707. This puts the bakery and food-to-go retailer ahead of the long-established coffee chain for the first time.

The shift comes as consumers increasingly use non-traditional coffee operators alongside dedicated coffee chains, with value becoming an important factor in the market.

The wider UK branded coffee shop market grew 3.5 per cent during 2025 to 12,313 outlets, while sales increased 5.5 per cent to £6.8bn, according to the report.

Greggs’ expanding estate has been a driver of its rise. The retailer opened 34 new shops during the first half of 2026, taking its estate to 2,773 locations by the end of June.

It has also continued to broaden its coffee proposition, with iced matcha lattes among the new products introduced during the period, alongside developments to its food range.

Greggs reported total sales of £1.1bn for the first half of 2026, up 7.2 per cent year on year, while like-for-like sales in company-managed shops increased 2.1 per cent.

The retailer is targeting around 100 to 110 net new openings during 2026 and has identified potential for at least 3,500 UK shops over the longer term.

Costa is also investing in store refurbishments, new formats and its range. In July, it brought scones back to its menu after a five year gap. The coffee chain launched an Afternoon Bundle featuring a regular hot or iced drink alongside a scone served with jam and cream.

Its revenue rose 3.5 per cent to £1.74bn in 2025.

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